Spending on drugs purchased at discounted 340B prices across all participating facilities went up 19% annually between 2010 and 2021, according to a June 17 report from the Congressional Budget Office.
Established by Congress in 1992, the 340B drug pricing program allows qualifying hospitals and clinics that treat low-income and uninsured patients to purchase some drugs at a discounted rate of between 25% and 50% off their normal price.
Enrollment in the 340B program has drastically increased in recent years, driving up spending and also leading to more disputes between covered entities who need to obtain affordable medications for uninsured or underinsured patients and drugmakers who need to protect company profits and resources.
Cancer drugs, anti-infective agents, and immunosuppressants accounted for 70% of total 340B spending in 2021 — up from 58% in 2010 — according to data from the Health Resources and Service Administration, which was analyzed by the Congressional Budget Office.
The majority of growth in 340B program spending — 73% — can be attributed to what has been spent on those major three drug classes as well: cancer drugs, anti-infectives, and immunosuppressants.
"Only a portion of the growth in 340B spending can be explained by marketwide trends or by disproportionate growth in spending on classes of drugs that have greater representation in the 340B program," the report states. "Other factors that probably contributed to the growth in spending include: Integration of hospitals and clinics, expanded facility participation due to the Affordable Care Act, and expanded use of off-site ('contract') pharmacies."
Here are six other updates from on 340B spending growth between 2010 and 2021 from the report:
- Around 88% of spending growth is attributable to hospitals and affiliated health system off-site clinics.
- Nearly 20% of 340B spending growth is attributable to spending on drugs dispensed at contract pharmacies.
- A majority of 340B spending has continued to focus on 3 drug classes: cancer agents, anti-infectives, and immunosuppressants regardless of facility type (hospital or federal grantee facility) and regardless of if a contract pharmacy or not. Categorically, spending has increased across these drug classes the most for hospitals and noncontract pharmacies.
- In 2021, 47% of 340B spending was at hospital facilities on cancer drugs, equivalent to $18.1 billion, alone.
- In 2021, federal-grantee facilities spent 77% on anti-infectives.
- Only six other classes of drugs accounted for more than 0.5% of 340B spending in 2021, including blood formulation/coagulation agents, serums, toxoids and vaccines, respiratory agents, hormones and synthetic substitutes, central nervous system agents and cardiovascular agents.